Job growth and a strong economy are expected to increase the demand for office space in San Diego this year, concludes a recently released forecast from real estate brokerage Marcus & Millichap.

San Diego was ranked No. 15 out of 46 markets in the annual report based on demand and economic potential. The report predicted the region would add around 3,800 new office workers this year.

The big picture: Job growth and a strong economy have increased the demand for office space across the United States. Tax changes approved in Congress in December could also mean accelerated economic growth, the report said, causing more office workers to be hired.

How San Diego compares: San Diego has some of the most expensive office space in the nation, from an average $275 to $324 per square foot. In places like Milwaukee and Cleveland office space is an average $75 to $124 per square foot. Still, there are markets more expensive than San Diego: Los Angeles, New York City, San Francisco, San Jose and Seattle (an average $325 to $550 per square foot).

Why San Diego may be a hot spot: San Diego fell two places from No. 13 last year. While the ranking moved slightly down, Marcus & Millichap analysts say the region is still a prime spot for office space because of its diverse employment base. The report predicted the office vacancy rate this year would stay around a relatively healthy 13 percent, and office rent prices would increase 1.9 percent. It said growth will largely occur in biotech, government contractor and professional services.

Also, it said downtown could prove promising to investors because of well-educated millennials who would like to live and work there.

What it takes to be a top market: The Seattle-Tacoma market was ranked as the top market in the report because it has one of the tightest vacancy rates in the nation and Amazon’s major expansion in the region. The tech giant occupies roughly 8.1 million square feet of office space in Seattle, helping push the office vacancy rate to 9.6 percent at the end of last year. Competition for space from other tech companies is expected to increase rent prices 4 percent this year.

The lowest ranked market, Northern New Jersey, is expected to have a 16.6 percent vacancy rate this year and a 0.7 percent rent increase.

More amenities: As the economy stays strong, the report said, it may become increasingly difficult to find good workers. This could force companies to utilize their office space to expand amenities they offer employees or promote the office location if it is near a desirable area.

Where businesses could go: Movement away from downtown is a possibility in many markets, wrote Marcus & Millichap vice presidents Al Pontius and John Chang in the report. “A considerable number of companies will relocate offices to the suburbs to more effectively tap the workforce that resides there,” they wrote, “and to expand space allocations at a more affordable price.” Additionally, the report said national and regional banks are looking more favorably at suburban deals, especially in densely populated suburbs.

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Hundreds of San Diego hotel workers marched in downtown San Diego to pressure Marriott hotels to improve pay and working conditions for low wage workers.

Hundreds of San Diego hotel workers marched in downtown San Diego to pressure Marriott hotels to improve pay and working conditions for low wage workers.

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Hundreds of San Diego hotel workers marched in downtown San Diego to pressure Marriott hotels to improve pay and working conditions for low wage workers.

Hundreds of San Diego hotel workers marched in downtown San Diego to pressure Marriott hotels to improve pay and working conditions for low wage workers.

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The Supreme Court on Monday struck down a federal law that bars gambling on football, basketball, baseball and other sports in most states, giving states the go-ahead to legalize betting on sports.

The Supreme Court on Monday struck down a federal law that bars gambling on football, basketball, baseball and other sports in most states, giving states the go-ahead to legalize betting on sports.

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Viasat is a global communications company working to connect the unconnected throughout the world. As part of our mission, we're bringing low-cost, high-speed satellite internet to rural towns throughout Mexico. We believe that everyone, everywhere deserves the opportunity to add their voice to the global conversation. (Courtesy of Viasat)

Viasat is a global communications company working to connect the unconnected throughout the world. As part of our mission, we're bringing low-cost, high-speed satellite internet to rural towns throughout Mexico. We believe that everyone, everywhere deserves the opportunity to add their voice to the global conversation. (Courtesy of Viasat)

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San Diego has agreed to sell 16 lots in Nestor for $1 each, in the pursuit of affordable housing. The nonprofit San Diego Community Land Trust plans to build three and four-bedroom homes there for people with moderate incomes. That means a family of five with an income of up to $102,750.

San Diego has agreed to sell 16 lots in Nestor for $1 each, in the pursuit of affordable housing. The nonprofit San Diego Community Land Trust plans to build three and four-bedroom homes there for people with moderate incomes. That means a family of five with an income of up to $102,750.

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Toys R Us still sells about 20% of the toys bought in the U.S., according to an analyst at Jefferies LLC.

Toys R Us still sells about 20% of the toys bought in the U.S., according to an analyst at Jefferies LLC.